The sentence can be recast with both "them" and the comma still utilized:
There are (more than) 300 million English speakers (in) India, most of (them) having acquired English (as) a second language.
Surely, I do not pretend this would have been a choice available in the real test, still I think it makes an useful point in terms of alternative phrasing.

It should be most of whom, not most of *them.
Otherwise it is a comma-splice error caused by incorrectly attempting to join together two independent clauses with a mere comma and no conjunction.
These are all correctly formed:
There are more than 300 million English speakers in India. Most of them acquired English as a second language.
There are more ...

I would expect a native English speaker to be able to work out the meaning from the context (if the writing is informal) and otherwise use the intended synonym (bullying, practical joking etc.)
Yes. "Ragging" is formed from the word "Rag".
The OED definition you gave reminded me of "Rag Week" at just about any UK university. Basically the Student Union ...

The British influence is no long on Indian English. Since the teachers in India are themselves not native speakers of the language, they fail to bring in the native flavor, and the usage at times is archaic or direct translations from the native tongue.
However, if we examine the print media, the usage of terms such as eve-teasing and ragging is rampant.
...

I experienced the same when I was in grade/high school (80s/90s) in Canada, and have heard my father using 'ragging' in the same context, so we know it's been in use in the meaning of teasing, tormenting, or otherwise psychologically damaging your fellow classmates ;) for years.

Ragging is the present participle of verb (rag- to scold).
Ragging is similar to but not the same as hazing.
Ragging in India is synonymous with bullying, the act of intimidating someone.
Why it is being used in India =>
While ragging may indeed have started out as a term for teasing (British- to play rough/boisterous practical joke on sb).
...

Ragging was a schoolboy (mostly public school) word for teasing, playing practical jokes on, and so forth (you could certainly rag a master, but care was needed). It was still in use when I was at school, but has probably died out by now in England, save for those who deliberately use archaic slang.

I am a little confused by your question. You appear to have answered most of it yourself.
This is is also called hazing. (see your Wikipedia excerpt)
It is probably derived from rag. (see your OED excerpt)
The dictionary says it has been used. (see your Longman's excerpt)
Many English speakers in India learned from the British colonists; it's why the ...

From Language in India:
As mentioned your question is too broad and there is probably no definite answer to it. The following extract examines the issue under different relevant aspects such as the phonological, morphological, lexical, and syntactic ones and can give an insight into what you are looking for:
Indian English is a distinct variety of ...